Skip Navigation

This Article
Right arrow Full Text (PDF)
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Alert me to new issues of the journal
Right arrow Add to My Personal Archive
Right arrow Download to citation manager
Right arrow Search for citing articles in:
ISI Web of Science (5)
Right arrowRequest Permissions
Google Scholar
Right arrow Articles by León-Ledesma, M. A.
Right arrow Articles by Thirlwall, A. P.
Right arrow Search for Related Content
Related Collections
Right arrow E10 - General
Right arrow E23 - Production
Right arrow O40 - General
Right arrow O47 - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us  
What's this?

Cambridge Journal of Economics 26:441-459 (2002)
Copyright © 2002 Cambridge Political Economy Society

Article

The endogeneity of the natural rate of growth

Miguel A. León-Ledesma and A. P. Thirlwall *

*University of Kent at Canterbury.

Address for correspondence: Professor A. P. Thirlwall. Department of Economics, Keynes College, University of Kent at Canterbury, Canterbury, Kent CT2 7NP, UK; email: A.P.Thirlwall{at}ukc.ac.uk

Abstract

The aim of this paper is to estimate the sensitivity of the natural rate of growth to the actual rate of growth for 15 OECD countries over the period 1961–95, on the hypothesis that the natural rate of growth is not exogenously given. To do this, we estimate the natural rate of growth and, then, how it changes when the actual growth rate is different from the natural rate. As a side test of the endogeneity hypothesis, we also test for the direction of causality between national output and factor inputs for the same set of countries. Our results support the idea that the natural rate of growth is not independent of the actual rate of growth and bring to the fore the importance of focusing on demand as well as supply for an understanding of long-run growthrate differences between countries.

Key Words: Natural rate of growth • Actual rate of growth • Endogeneity • Causality • Inputs • Output


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us    What's this?


This article has been cited by other articles:


Home page
 Cambridge J EconHome page
E. Hein and A. Tarassow
Distribution, aggregate demand and productivity growth: theory and empirical results for six OECD countries based on a post-Kaleckian model
Camb. J. Econ., November 10, 2009; (2009) bep066v1.
[Abstract] [Full Text] [PDF]

Home page
 Cambridge J EconHome page
G. A. Libanio
Aggregate demand and the endogeneity of the natural rate of growth: evidence from Latin American economies
Camb. J. Econ., September 1, 2009; 33(5): 967 - 984.
[Abstract] [Full Text] [PDF]

Home page
 Cambridge J EconHome page
E. Hein and L. Vogel
Distribution and growth reconsidered: empirical results for six OECD countries
Camb. J. Econ., May 1, 2008; 32(3): 479 - 511.
[Abstract] [Full Text] [PDF]

Home page
 Cambridge J EconHome page
D. Hodge
Inflation and growth in South Africa
Camb. J. Econ., March 1, 2006; 30(2): 163 - 180.
[Abstract] [Full Text] [PDF]

Home page
 Cambridge J EconHome page
A. Palacio-Vera
The 'modern' view of macroeconomics: some critical reflections
Camb. J. Econ., September 1, 2005; 29(5): 747 - 767.
[Abstract] [Full Text] [PDF]


Disclaimer: Please note that abstracts for content published before 1996 were created through digital scanning and may therefore not exactly replicate the text of the original print issues. All efforts have been made to ensure accuracy, but the Publisher will not be held responsible for any remaining inaccuracies. If you require any further clarification, please contact our Customer Services Department.